SB 756
Modifies provisions relating to public utilities
Sponsor:
LR Number:
3774S.10P
Last Action:
5/4/2022 - Reported Do Pass H Rules - Administrative Oversight
Journal Page:
Title:
SS SCS SB 756
Calendar Position:
Effective Date:
August 28, 2022
House Handler:

Current Bill Summary

SS/SCS/SB 756 - This act modifies provisions relating to public utilities.

STATE PURCHASING (Section 34.045)

The Commissioner of Administration shall waive the requirement of competitive bids or proposals for the contracting of legal counsel, financial advisors, and other consultants as necessary to effectuate the purposes of a provision of law relating to financing orders for utilities.

DISASTER FUND (Section 44.032)

The act allows rural electric cooperatives, as defined in the act, to receive funds from the Missouri Disaster Fund.

This provision is identical to a provision in the perfected HCS/HB 1734 (2022).

SALES TAXES ON CERTAIN PURCHASES OF UTILITIES (Section 144.010)

This act provides that, for the purposes of levying sales tax, the definition of "sale at retail" shall not include the purchase by persons operating hotels, motels, or other transient accommodation establishments of electricity, electrical current, water, and gas, whether natural or artificial, which are used to heat, cool, or provide water or power to the guests' accommodations of such establishments, including sleeping rooms, meeting and banquet rooms, and any other customer space rented by guests, and which are included in the charge made for such accommodations. Any person required to remit sales tax on such purchases prior to August 28, 2022, shall be entitled to a refund on such taxes remitted.

This provision is identical to SB 945 (2022).

SALES TAX EXEMPTION FOR CERTAIN PURCHASES (Section 144.030)

This act authorizes a sales tax exemption for purchases by a Missouri company, as defined in the act, of solar photovoltaic energy equipment used to construct a solar photovoltaic energy system and all purchases of materials and supplies used directly to construct or make improvements to such systems, provided that such systems allow for energy storage, include advanced or smart meter inverter capacity, or are projects greater than twenty megawatts.

This provision is similar to SCS/SB 881 (2022).

RATE ADJUSTMENTS OUTSIDE OF GENERAL RATE PROCEEDINGS(Section 386.266)

Current law allows an electrical corporation to apply to the Public Service Commission to approve rate schedules authorizing periodic rate adjustments outside of general rate proceedings due to changes in customer usage due to weather and conservation or to defer and recover certain depreciation expense and return for qualifying electric plant recorded to plant-in-service on the utility's books, but an electrical corporation cannot elect to do both.

Under this act, an electrical corporation may make one application to the Commission to either approve rate schedules authorizing periodic rate adjustments outside of general rate proceedings or to defer and recover certain depreciation expense and return for qualifying electric plant recorded to plant-in-service on the utility's books if the corporation has provided notice to the Commission to elect the opposite option. However, the corporation shall not concurrently utilize electric rate adjustments and the deferrals.

NET METERING (Sections 386.885 & 386.890)

This act establishes the Task Force on Distributed Energy Resources and Net Metering, to conduct hearings and research information related to net metering as set forth in the act. The Task Force shall compile a report for the General Assembly by December 31, 2023. The Task Force shall dissolve on December 31, 2023, or when the Task Force concludes its work, whichever is sooner.

The act modifies the definitions of "department", which is changed from the Department of Economic Development to the Department of Natural Resources, and "retail electric supplier", which now includes municipally-owned utilities.

The sale of qualified electric energy units to any customer-generator shall be subject to provisions of law related to consumer protection.

This provision is identical to a provision in the perfected SS#2/SCS/SB 745 (2022).

TASK FORCE ON SOLAR ENERGY SYSTEMS (Section 393.1072)

This act establishes the "Task Force on Fair, Nondiscriminatory Local Taxation Concerning Solar Energy Systems".

The Task Force shall compile a report for delivery to the General Assembly by December 31, 2022. The report shall include information on the taxation of solar energy systems and related issues as stated in the act.

ACCOUNTING PRACTICES OF PUBLIC UTILITIES (Section 393.1275)

Under this act, electrical corporations, gas corporations, sewer corporations, and water corporations shall defer to a regulatory asset or liability account any difference in state or local property tax expenses actually incurred, and those on which the revenue requirement used to set rates in the corporation's most recently completed general rate proceeding was based. The regulatory asset or liability account balances shall be included in the revenue requirement used to set rates through an amortization over a reasonable period of time in such corporation's subsequent general rate proceedings. Such expenditures deferred under this provision are subject to Commission prudence review in the next general rate proceeding after deferral.

This provision is identical to a provision contained in the perfected SS/SCS/SB 745 (2022) and similar to a provision contained in HCS/HB 1734 (2022).

PLANT-IN-SERVICE ACCOUNTING (Section 393.1400)

This act modifies the definition of "weighted average cost of capital" for a provision relating to plant-in-service accounting.

Current law states that an electrical corporation's election to defer depreciation expense, as set forth in statute, shall allow it to make such deferrals until December 31, 2023, or if approved by the Public Service Commission, continue to make such deferrals from January 1, 2024, through December 31, 2028. Under this act, an electrical corporation may seek permission to continue to make such deferrals for an additional 5 years beyond December 31, 2028, by filing an application with the Commission seeking such permission by December 31, 2026. The application shall be ruled on within 180 days after its filing.

The Commission shall make the determination of whether to grant such permission to continue after a hearing.

Failure to obtain such Commission permission to continue shall not affect deferrals made through the date for which permission has been granted, or the regulatory and ratemaking treatment of the regulatory assets arising from such deferrals.

The Commission may take into account any change in business risk to the electrical corporation resulting from implementation of the deferrals in setting the corporation's allowed return in any rate proceeding, in addition to any other changes in business risk experienced by the corporation.

CAPITAL INVESTMENT PLAN (Section 393.1400)

For each project in the specific capital investment plan on which construction commences on or after January 1st of the year in which the plan is submitted, and where the cost of the project is estimated to exceed $20 million, the electrical corporation shall identify all costs and benefits that can be quantitatively evaluated.

If a cost or benefit cannot be quantitatively evaluated, the corporation shall state the reasons why not, and how the corporation addresses such costs and benefits when reviewing and deciding to pursue a project.

No project shall be based solely on costs and benefits that cannot be quantitatively evaluated, and any quantification for such a project shall be accompanied by additional justification in support of the project.

In its report to the PSC on capital investments, an electrical corporation shall include information on the quantitatively evaluated costs and benefits generated by each of those investments that exceeded $20 million and any efficiencies achieved as a result of those investments.

DISCOUNTED ELECTRIC RATES (Section 393.1640)

This act modifies the criteria for electric customers to be considered for a discounted electric rate. The first discount of 35% is for customers with new load that is projected to be between 300 kilowatts but not more than 10 megawatts with a load factor of 45% and shall apply for 5 years. The second discount applies for new load that is projected to be more than 10 megawatts and have a load factor of 55% and the discount percentage shall be determined such that the applicant's total bill is expected to provide revenues equal to 120% of the corporation's variable cost, as described in the act, to serve the corporation's accounts that are to receive the discount. Such discount shall apply for 10 years.

In order to obtain one of the discounts, the customer's load shall be incremental, the customer must receive an economic development incentive from the local, regional, state, or federal government, and the customer must meet criteria set forth in the electrical corporation's economic development rider tariff sheet.

The electrical corporation shall verify the customer's incremental demand annually to determine continued qualification for the applicable discount.

In each general rate proceeding concluded after August 28, 2022, the difference in revenues generated by applying the discounted rates and the revenue that would have been generated without such discounts shall not be imputed into the electrical corporation's revenue requirement but instead such revenue requirement shall be set as described in the act.

An electrical corporation's authority to offer discounted rates shall terminate on the date that such electrical corporation's authority to make deferrals expires.

REVENUE REQUIREMENT (Section 393.1656)

Beginning January 1, 2024, that part of an electrical corporation's retail revenue requirement used to set the electrical corporation's base rates in each of the electrical corporation's general rate proceedings that are concluded on or after August 31, 2023, that consists of revenue requirement arising from inclusion in rate base of certain regulatory asset balances shall not exceed the revenue requirement impact cap, as such term is defined in the act. Such provision shall continue to apply to electrical corporations until such corporation's permission to defer and recover certain depreciation expense and return for qualifying electric plant recorded to plant-in-service on the utility's books expires.

FINANCING ORDERS (Section 393.1700)

The act allows the Public Service Commission to directly contract counsel, financial advisors, or other consultants as necessary to carry out the Commission's duties related to financing orders.

RESTRICTIVE COVENANTS (Section 442.404)

This act also specifies that no deed restriction, covenant, or similar binding agreement running with the land shall limit or prohibit the installation of solar panels or solar collectors, as defined in the act, on the rooftop of any property or structure.

This provision goes into effect on January 1, 2023.

This provision is identical to a provision in HCS/SB 820 (2022).

SUNSHINE LAW (Section 610.021)

This act adds individually identifiable customer usage and billing records for customers of a municipally owned utility, unless the records are requested by the customer or authorized for release by the customer, to the list of records that may be closed under the Sunshine Law. A municipally owned utility shall make available to the public the customer's name, billing address, location of service, and dates of service provided for any commercial service account.

This provision is identical to SB 827 (2022).

JAMIE ANDREWS